Macau Property Opportunities Fund saw average rentals at The Waterside grow by 6.4% between the third and fourth quarters to HK$19.85 per square foot per month.
The company is hopeful that Macau's VIP gaming segment will recover further, which will facilitate the continued recovery of rental values and improve occupancy rates.
The impending opening of the Hong Kong-Zhuhai-Macau Bridge in 2018 is expected to create more business opportunities for Macau and an influx of foreign labour.
Another of MPO's three remaining individual units at One Central Residences was divested during the quarter, taking the total number of units sold in 2017 to two. The 2,288-square-foot apartment was disposed of for US$3.7 million, approximately 2% above its latest valuation.
Despite positive sentiment in Macau's property market, sales performance at The Fountainside has been impeded by the government's imposition of lower loan limits. As at the end of December, 13 units including four villas and two duplexes remained available for sale.
The manager is exploring the option of reconfiguring the four villas and two duplexes into smaller apartments.
At Estrada da Penha, marketing efforts continued during the quarter with a noticeable pick up in sales enquiries. However, there are yet to be any firm offers.
MPO's adjusted NAV was US$257.4 million as at 30 September 2017, equating to US$3.37 (251 pence) per share.
As at the end of September 2017, the company's cash balance was US$15.2 million, of which US$3.3 million was pledged as collateral for debt facilities. Total borrowings were US$172.4 million, translating to a loan-to-value ratio of 38.2%.
The group said it continues to be optimistic about the current and future state of Macau's economy, but headwinds remain.
It added: "Any further attempts to clampdown on China's capital outflows may hinder the recovery of the gaming industry, especially the VIP segment, and further possible hikes in US interest rates, may lead to local banks increasing their mortgage rates.
"The much discussed Belt and Road Initiative is expected to transform perceptions of Macau from a gambling enclave to a business interface between China and Portuguese-speaking countries. Additionally, investment sentiment for the city's property market is expected to be boosted further by the completion of the Hong Kong-Zhuhai-Macau Bridge, which will increase connectivity and bring new business opportunities to Macau."